Revenue Recognition Accounting Policy

6 Months Ended

Jun. 30, 2021

Revenue Recognition and Deferred Revenue [Abstract]

Revenue Recognition

Revenue Recognition

Disaggregation of Total Revenues

The following tables disaggregate revenue by Concept, for our two most significant markets based on Operating Profit and for all other markets. We believe this disaggregation best reflects the extent to which the nature, amount, timing and uncertainty of our revenues and cash flows are impacted by economic factors.

	Quarter ended 6/30/2021
		KFC Division		Pizza Hut Division		Taco Bell Division		Habit Burger Grill Division		Total
U.S.
Company sales		$	16	$	5	$	223	$	138	$	382
Franchise revenues		48		67		160		1		276
Property revenues		3		2		10		—		15
Franchise contributions for advertising and other services		7		74		128		—		209
China
Franchise revenues		58		16		—		—		74
Other
Company sales		131		7		—		—		138
Franchise revenues		255		62		9		—		326
Property revenues		15		—		—		—		15
Franchise contributions for advertising and other services		149		16		2		—		167
		$	682	$	249	$	532	$	139	$	1,602

	Quarter ended 6/30/2020
	KFC Division		Pizza Hut Division		Taco Bell Division		Habit Burger Grill Division		Total
U.S.
Company sales	$	13	$	5	$	194	$	104	$	316
Franchise revenues	44		66		132		1		243
Property revenues	3		2		11		—		16
Franchise contributions for advertising and other services	5		78		107		—		190
China
Franchise revenues	47		12		—		—		59
Other
Company sales	73		14		—		—		87
Franchise revenues	146		46		4		—		196
Property revenues	11		—		—		—		11
Franchise contributions for advertising and other services	67		12		1		—		80
	$	409	$	235	$	449	$	105	$	1,198

	Year to date 6/30/2021
		KFC Division		Pizza Hut Division		Taco Bell Division		Habit Burger Grill Division		Total
U.S.
Company sales		$	30	$	10	$	431	$	259	$	730
Franchise revenues		92		134		304		2		532
Property revenues		7		2		20		—		29
Franchise contributions for advertising and other services		13		153		245		—		411
China
Franchise revenues		120		32		—		—		152
Other
Company sales		250		16		—		—		266
Franchise revenues		485		119		17		—		621
Property revenues		29		1		—		—		30
Franchise contributions for advertising and other services		281		33		3		—		317
		$	1,307	$	500	$	1,020	$	261	$	3,088

	Year to date 6/30/2020
		KFC Division		Pizza Hut Division		Taco Bell Division		Habit Burger Grill Division		Total
U.S.
Company sales		$	29	$	10	$	392	$	113	$	544
Franchise revenues		82		128		263		1		474
Property revenues		7		3		21		—		31
Franchise contributions for advertising and other services		9		148		214		—		371
China
Franchise revenues		94		22		—		—		116
Other
Company sales		187		27		—		—		214
Franchise revenues		358		105		11		—		474
Property revenues		25		1		—		—		26
Franchise contributions for advertising and other services		184		26		1		—		211
		$	975	$	470	$	902	$	114	$	2,461

Contract Liabilities

Our contract liabilities are comprised of unamortized upfront fees received from franchisees. A summary of significant changes to the contract liability balance during 2021 is presented below.

	Deferred Franchise Fees
Balance at December 31, 2020	$	415
Revenue recognized that was included in unamortized upfront fees received from franchisees at the beginning of the period	(34)
Increase for upfront fees associated with contracts that became effective during the period, net of amounts recognized as revenue during the period	34
Other(a)	(2)
Balance at June 30, 2021	$	413

(a)    Primarily includes impact of foreign currency translation.

We expect to recognize contract liabilities as revenue over the remaining term of the associated franchise agreement as follows:

Less than 1 year	$	65
1 - 2 years	60
2 - 3 years	56
3 - 4 years	50
4 - 5 years	44
Thereafter	138
Total	$	413

^[1]

[1] (a)    Primarily includes impact of foreign currency translation.